Financial News and Portfolio Management Discussion through April 18th

All the news you need to stay informed about what’s currently driving the market — courtesy of Raffa Wealth Management, LLC.

US stocks posted a second week of gains driven by optimism over containment and treatment of the virus and several states planning to reopen portions of the economy.  The S&P 500 gained 3.0%, while the Dow climbed 2.2% for the week.  The Dow gained 15% over the past two weeks, its best performance since the 30s. Abroad, the FTSE All World Ex US rose 1.0% for the week.  The yield on the 10-year Treasury edged down over the week to finish at 0.66%.  Oil prices hit a new 18-year low of $18.27 a barrel on weak demand.

The US, Saudi Arabia and Russia reached an agreement for the 23 major oil producing countries around the world to cut oil production by 9.7 million barrels a day to help support the price of oil.

The IMF said the world has likely already entered a recession which will likely be the worst downturn since the depression.  They expect the US to contract 5.9% this year.

US Industrial production fell a worse than expected 5.4% in March.

US retail sales fell 8.7% in March the steepest decline in over 70 years.

Another 5.2 million people filed for unemployment benefits in the past week bringing the four week total to 22 million or 13% of the labor force.  The worst four week stretch on record.

China contracted 6.8% in the first quarter, the first ever decline in growth for the country since the data was first tracked in 1992.  However, the decline was better than the 8.3% projected.

Over 300 companies have withdrawn their financial guidance and 175 companies have suspended stock buy backs, or cut dividends.

S&P 500 profits are projected to drop 11% in the first quarter and 27% in the second quarter.

JP Morgan and Wells Fargo saw profits sink as they set aside billions for expected defaults.  Other major banks saw their profits fall substantially, but their trading arms did well.

There is no guarantee that any investment strategy, including those described here, will be successful. Any investment or investment strategy can lose money. Past performance does not guarantee or predict future results. You should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from Raffa Wealth Management, LLC. This information was gathered from reliable sources but we cannot guarantee accuracy. Indexes do not reflect the fees associated with actual investments and such fees would reduce the performance illustrated.
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